Liquefied Natural Gas (LNG)

Liquefied Natural Gas () For the 2014 SPE Roughneck Camp Chris Caswell, Director and F KBR July 17, 2014

How to Plan a 30 Minute Discussion on SPE Objective: What happens after gas is produced and before it becomes a marketable product (For liquid natural gas transportation, specifically)? Presentation Strategy: Short list of key messages Cover primarily the liquefaction link of the chain Encourage questions 2

Key Messages for Today Produced gas (even when separated or treated near the reservoir) requires extensive and mandatory conditioning to make projects are large complex projects, often in remote locations Process design is not simplistic, Scope is highly civil/mechanical, Projects are capital intensive, and Not all plants are created equal (NALPACE) Offshore liquefaction (F) significantly increases the complexity of an project 3

Items Not Addressed Today transfer, storage, regasification, and shipping Regas: more simplistic than liquefaction, but important Shipping: decades of efficient manufacturing methods Economics: Capital cost estimates and schedules (e.g. US$ per ton of ) Onshore vs. F, baseload plants vs. tolling facilities Market views / growth of Industry statistics, project forecasts, and news Review of liquefaction projects and process technologies History, size, and growth of trains and complexes Licensor share, process selection, cycle efficiency, equipment, etc. Permitting, siting, approval process in the USA Terminal (regas) conversions to liquefaction (export) Ownership of projects and the contracting community 4

Why : Long Distance Transportation of Natural Gas

The Transportation of Natural Gas Pipeline Pipeline & GTL & Gas to Chemicals Methanol DME Ammonia

What is? Typically, is: Cool natural gas at essentially atmospheric pressure Liquefied at -161º C (-256º F) and slightly subcooled Colorless, odorless, non-corrosive, and non-toxic A mixture of components, primarily C 1, C 2,, and N 2 Example composition of (mol %): 85-90 % methane (C 1 ) 3-8 % ethane (C 2 ) 1-3 % propane ( ) 1-2 % butanes (iso-c 4 and n-c 4 ) 0-2 % pentanes (iso-c 5 and n-c 5 ) 0-2 % nitrogen (N 2 )

Source: GAS CONDITIONING FOR IMPORTED by D. McCartney for 82 nd annual GPA Convention, March 2002.

Volumetric Reduction of Natural Gas -161 o C Natural Gas Plant Volume Reduction 600:1

FEED GAS Condensate Removal Gas Treating NGL Removal Liquefaction End Flash N 2 C 1 C 2 C 4 C 5 Hg H 2 0 CO 2 /H 2 S C 6+ Condensate Acid Gas Water Mercury Natural Gas Liquids

What are the End Uses for? Imported can support the following activities: Augmenting baseload pipeline supply Support peak-shaving activities (peak demand periods) Fuel for nearby power plants Feedstock for industrial use (Ammonia, Ethylene) Fuel substitution (natural gas for diesel) at reduced cost

How is Made: The Traditional Value Chain Key Issue - Integrating all links in the chain Gas Production & Transmission Gas Treatment & Liquefaction Shipping Receiving Terminal Natural Gas End Use

NIGERIA SITE early 1990 s Facilities Are Remote

NIGERIA FACILITY Facilities Are Complex

What Does an Train Look Like?

SEGAS First single train of 5 Mt/a

What Does an Complete Facility Look Like?

Facility Example: SEGAS

Train 3: 2.5 Mt/a Train 4: 4.4 Mt/a

Design of an Plant Australia Northwest Shelf Plant 1989, 1993

Design Factors Affecting Overall Cost Targeted Plant Capacity Number/size of Process Trains Series or parallel within train Large vs. small train Common Areas / Utilities Availability / Reliability Sparing, maintenance, startup/shutdown OPEX costs Modular Concepts Constructability Site Selection Marine access, soils, earthquake Design Margins Plant Layout Project Execution Schedule (life cycle) NALPACE Not all Plants are Created Equal Because of site-specific criteria, it is unwise to compare one plant to another based solely on capacity and capital cost (US$ per Mt/a)

Natural Gas Data Feed Gas to Plant Typical inlet Composition? No, but an example: 2.0% Nitrogen, 86.0% Methane 6.0% Ethane, 3.0% Propane 1.5% Total Butane+ 1.0% Carbon Dioxide Trace: H 2 S, Hg, RSH, COS, BTX In reality, there is no such thing as a typical inlet gas composition Coal seam methane reserves can have > 98% methane Acid gas content (CO2) as high as 15% in Australia and potentially much higher (over 50%) in stranded fields Associated gas reservoirs could have waxes (e.g. C 20+ ) that affect flow assurance

Basic Refrigeration - Simple PFD Large amount of Energy Input Driver (not shown) Compressor Process Flow Diagram Heat Exchangers Condenser Q High Temperature (Ambient) Work (input) Compressor Refrigerant is a Vapor Refrigerant is a Liquid out Accumulator Suction Drum J-T Valve Where the magic happens GAS in Heat Exchanger Q Low Temperature (Sub - Ambient) Rough rule of thumb : 35 MW of shaft power per Mt/a for efficient liquefaction processes

Typical Block Diagram Liquefaction Plant C2 FUEL C4 HYDROCARBON FRACTIONATION BY PRODUCT GASOLINE FUEL NATURAL GAS FEED CO 2 REMOVAL DEHYDRATION & MERCURY REMOVAL CHILLING C2 C3 LIQUEFACTION C4 NITROGEN REJECTION OFFSITE STORAGE REFRIGERATION SYSTEM REFRIGERATION SYSTEM A two-stage refrigeration cycle is used in this example

Typical Block Diagram - Liquefaction Plant C2 FUEL C4 HYDROCARBON FRACTIONATION BY PRODUCT GASOLINE FUEL NATURAL GAS FEED CO 2 REMOVAL DEHYDRATION & MERCURY REMOVAL CHILLING C2 C3 LIQUEFACTION C4 NITROGEN REJECTION OFFSITE STORAGE REFRIGERATION SYSTEM REFRIGERATION SYSTEM

Acid Gas Removal Requirements Removal of CO 2 to 50 parts per million (ppm) CO 2 would freeze at cryogenic temperatures Safely below solubility limit of CO 2 in Removal of H 2 S (to end-user pipeline specifications) Specification is often total weight of sulfur in product Targeted removal of Mercaptans and COS Acid Gas Disposal (after capture) Venting (in small quantities), thermal oxidation (burning), or Sequestration (large quantities, e.g. Gorgon ) About 80% of AGRU Cost is associated with Solvent Regeneration System AGRU absorber is heaviest vessel (but not largest) in the plant

Typical Acid Gas Removal Scheme Process Flow Reflux Condenser Acid Gas Treated Gas Lean Amine Lean Absorber Semi-Lean Amine Amine Cooler Low- Pressure Flash Bulk Absorber Stripper Sour Gas Flash Gas Rich Amine High- Pressure Flash Reboiler Lean/Rich Exchanger

Typical Dehydration Scheme Process Flow Regeneration Gas Compressor Regeneration Cooler Water Saturated Natural Gas Drier Precooler Regeneration Gas Knockout Drum Water Hydrocarbon Liquid 2 Driers (Absorption) 1 Drier (Regeneration) Regeneration Heater Molecular Sieve Process Vessels Commonly a 3 bed system (2 operating) Outlet specification: 1 ppm water Regeneration System to remove water from beds Dry Gas To Liquefaction Filter

Mercury Removal Unit Mercury has to be removed from natural gas to prevent corrosion in aluminum equipment E.g. the Main Cryogenic Heat Exchanger Removal of mercury by: Adsorption via sulfur impregnated bed in vessel common As part of dehydration with added mol sieve less common Replacement of Hg removal beds is necessary for maintenance No regeneration like in dehydration If integrated with dehydration, Hg is with water on regeneration

Typical Mercury Removal Scheme Process Flow From Dehydration Section (Single) Mercury Removal Column Particle Filter Outlet Gas Specification is generally 10 ng (nanograms) of mercury per cubic meter of gas. To Liquefaction Unit

Simplified version APCI Propane Pre-cooled MR Process

APCI Propane Pre-cooled MR Process LOW BTU FUEL GAS HP MP LP LLP MR LIQ EXP EXP NRU RUNDOWN PRODUCT PUMP MCHE REFLUX DRUM HP MR MP MR LP MR LPG REINJECTION TREATED FEED GAS HP DEHY/Hg REMOVAL MP LP LLP SCRUB COLUMN To FRACTIONATION

APCI Propane Pre-cooled MR Process LOW BTU FUEL GAS HP MP LP LLP MR LIQ EXP EXP NRU RUNDOWN PRODUCT PUMP MCHE REFLUX DRUM HP MR MP MR LP MR LPG REINJECTION Benzene comes out here by cold reflux TREATED FEED GAS HP DEHY/Hg REMOVAL MP LP LLP SCRUB COLUMN Red lines denote the feed gas path through liquefaction and the path of NGLs (natural gas liquids) To FRACTIONATION

Nitrogen Removal The higher the nitrogen content of, the lower its gross heating value Therefore, why transport an undesirable component in the? Balance cost of removal vs. influence on heating value However, some nitrogen in can reduce the boil off of more valuable components during transport Nitrogen vaporizes first, before methane Modest concentrations of N2 can be reduced by a flash drum Deeper removal by a N2 removal column/process Nitrogen specification in is commonly 1% max

Typical Block Diagram - Liquefaction Plant C2 FUEL C4 HYDROCARBON FRACTIONATION BY PRODUCT GASOLINE FUEL NATURAL GAS FEED CO DEHYDRATION REMOVAL 2 & MERCURY REMOVAL CHILLING C2 C3 LIQUEFACTION C4 NITROGEN REJECTION OFFSITE STORAGE REFRIGERATION SYSTEM REFRIGERATION SYSTEM

Propane Pre-cooled MR Process LOW BTU FUEL GAS HP MP LP LLP MR LIQ EXP EXP NRU RUNDOWN PRODUCT PUMP MCHE REFLUX DRUM HP MR MP MR LP MR LPG REINJECTION TREATED FEED GAS HP DEHY/Hg REMOVAL MP LP LLP SCRUB COLUMN To FRACTIONATION

Typical Fractionation Scheme Process Flow Uses of Fractionation Unit: Make liquid products for sale (LPG and Condensate help econ) Make refrigerants (MR make-up or high purification C3) Stabilize NGLs for reinjection C3 Ref C2 to Storage LPG Reinjection to MCHE C3 Ref SW SW C3 to Storage Scrub Column Bottoms Deethanizer Depropanizer Debutanizer HO HO HO SW Condensate to Storage HO: Hot Oil (or other heat), SW: Seawater (or other cooling)

A Few Words on Floating

Standard Value Chain Shipping Storage & Loading Treating & Liquefaction Liquefaction Facility Complex project at a challenging location Receiving Terminal Moderate size project at industrial location Transportation Using efficient fabrication methods

The Full Floating Chain FPSO or F FSRU Complex Project, Efficient Fabrication, with Marine Installation

New Complexities for Designing Offshore Marinization of Process Design Layout, equipment selection, and equipment spacing Modularization Strategy, weight/size, fabrication and assembly plan Safety, Accommodation, Spill protection, Storage Turret and mooring systems Towing / transportation to site Hookup, Commissioning, and Startup Pre-commissioning prior to tow, isolation offshore Turnaround and Maintenance Operations Execution strategy and contracting strategy Cost competitiveness, internal rate of return, comparison to onshore

Questions